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Magnetic compass needle and bar magnet both have magnetic field. When they brought near to each other, these magnetic fields interact each other giving deflection in needle.
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A compass needle get deflected when brought near a bar magnet because a compass needle is in fact, a small bar magnet. The ends of the compass needle point approximately towards north and south directions.
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The compass needle is a small magnet. That’s why when a compass needle is brought near a bar magnet, its magnetic field lines interact with that of the bar magnet. Hence, a compass needle gets defected near a bar magnet.
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